THE LIVING STANDARD AND DEVELOPMENT ANALYSIS THROUGH THE EVOLUTION OF GROSS DOMESTIC PRODUCT FOR THE PERIOD

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1 THE LIVING STANDARD AND DEVELOPMENT ANALYSIS THROUGH THE EVOLUTION OF GROSS DOMESTIC PRODUCT FOR THE PERIOD Abdul Rahman IBRAHIM 1, Raluca NECULA 1, Diana Roxana CAPĂTĂ 2 1 University of Agricultural Sciences and Veterinary Medicine Bucharest, 59 Marasti, District 1, , Bucharest, Romania, Phone: /232, s: ibrahimabdulrahman@hotmail.com, raluca_nec@yahoo.com 2 Lund University, Paradisgatan 2, Lund, Sweden, SE , Phone: +46 (0) , diana_capata@yahoo.com Corresponding author: raluca_nec@yahoo.com Abstract. This paper aims to highlight the importance of the gross domestic product for the study of an economic area or at the global level, through the analysis of the evolution of this indicator over the period 2000 to Into the analysis on GDP is analyzed the share that owns agriculture in gross domestic product, the evolution of the GDP growth, the evolution of investments in the studied economic zones, the import and exports of goods and services evolution. All this gives us an overview of the evolution and status of the global economy and in the studied economic areas. Key words: the average, economic zones, evolution, GDP, average growth rate. INTRODUCTION The phenomena that mark the evolution of the world economy in recent decades stand under the sign of regionalization, globalization of interdependencies and of the interaction. Numerous studies highlight the heterogeneity of the world economy, adding that between its different areas, gaps remain owing to the uneven development [1]. The Gross Domestic Product (GDP). Is the synthetic expression of economic activity results produced in the economic territory in a period of time, regardless of the contribution that brought the domestic or foreign subjects[4]. Is the market value of all goods and services within a country's borders in a certain period of time, including foreign companies manufacturing operates in the country, but excluding the production of domestic companies abroad. GDP indicate the strength of an economy by displaying the market value of goods and services produced in an economy in a given year. The main components of GDP are consumption, investment, net exports, and Government property expenditure, of which individual consumption represents about two thirds of GDP. The GDP deflator index is often used in relation to GDP is to measure changes in the cost of goods and services of a country. An increase in GDP reflect an economic expansion. The increase in GDP of a country to another country, makes the first more appealing to investors. GDP is intended to strengthen the national currency[3]. The Gross domestic product per capita (GDP/capita) is the most widely used indicator in measuring the levels of development between regions, being used by the European Union to measure disparities between regions development, including the indicative financial allocations between its regions as regards cohesion policy[2]. MATERIALS AND METHODS After the level of socio-economic development, world States can be grouped into: States with high level of economic development, states with average level of economic development and in developing countries [6]. States with a high level of economic development. The most highly developed States. 155

2 "Group of seven". Small States highly developed in Europe. Newly industrialized countries ("Asian dragons"). Migratory capitalism States. States with average level of economic development Countries with economies in transition: the former socialist countries in Europe, CIS countries and China. Key countries medium developed: Brazil, Mexico, Argentina, Turkey. Oil-exporting countries (oil monarchies): Saudi Arabia, United Arab Emirates., Kuwait, Qatar, Bahrain,Oman, Brunei. Developing States. Countries with more advanced level of development: countries in Latin America, with the exception of those in the Second Group and in Asia (including India, Indonesia, Iran), North Africa and countries in Oceania. The most underdeveloped countries in the world are 32 African countries, 5 Asian countries from Latin America, Haiti, etc. Gross domestic product GDP can be defined: a) GDP is the sum of gross added values plus taxes and less subsidies on products; b) GDP is equal to the sum of final uses of goods and services; c) GDP is the sum of uses of generation of income account of the total economy [4]. xi x For the arithmetic mean = n ; where: X = the arithmetical mean; Xi = The average production values for a number of years (i); n = number of years taken into account The annual average growth rate [5] = r ( p1/ p0) 1; where: r = average annual growth rate; p1/po = entangled growth indicators The data come from the statistical bulletins published by the World Bank and are interpreted with the aid of the indicators listed above. RESULTS AND DISCUSSIONS The data presented in table no. 1. set the following situation in terms of the evolution of the GDP/capita: Table 1. The evolution GDP/ capita evolution on economic zones and worldwide, for the period 2000 to 2012 East and Pacific Asia Highly indebted poor countries (PPTE) Less advanced countries (clas ONU) USD/loc 2,388 3,498 2,751 4,112 7,197 5,635 2, ,304 % USD/loc 908 1,629 1,197 1,883 4,916 3,272 2, ,314 % USD/loc 22,332 32,675 24,872 34,817 39,518 38,755 13, ,347 % USD/loc 19,522 29,232 22,126 31,275 35,213 34,601 12, ,843 % USD/loc % USD/loc % USD/loc 34,449 45,016 38,526 46,392 51,800 48,830 10, ,074 % USD/loc 23,462 31,652 25,978 33,082 38,262 35,836 9, ,286 % USD/loc 2,356 3,605 2,756 4,113 5,461 4,887 2, ,904 % USD/loc ,447 1, % USD/loc , % USD/loc 5,429 7,303 5,980 7,771 10,343 9,070 3, ,644 % The Arab countries present a continuing growth throughout the period analyzed, with % in 2005 compared to 2000 and 1.14% in 2012 compared to 2006, the rate of increase 156

3 in is of 9.63%; - The European Union shows an increase of 1.15% in 2005 compared to 2000, in the following period the increases to be more weighted, in 2012 by 0.98%, the annual growth rate for is of 5.04%; - The global value of GDP has a value in 2012 of 10,343$/capita, with an average of $ 9,070/capita and a growth rate for the period by 5.52%. Table 2. The size and evolution of the agriculture share in national GDP, on economic zones and worldwide, % PIB % East and Pacific Asia % PIB % % PIB % % PIB % Highly indebted poor countries % PIB (PPTE) % Less advanced countries (clas ONU) % PIB % % PIB % % PIB % % PIB % % PIB % % PIB % % PIB % The share of agriculture in GDP is shown in table no. 2, as follows: - In Arab countries, the share of agriculture in national GDP occupies values around the average of 6.7% for the period 2000 to 2012, falls for the entire period from 8.6% in 2000 to 5.2% in 2012; Table 3. The evolution of foreign investments on economic areas and globally, period mil $ 2,640 46,060 15,683 69,506 47,202 58,240 42, ,777 % East and Pacific Asia mil $ 45, ,243 71, , , , , ,437 % mil $ 422, , , , , ,879 65, ,260 % mil $ 625, , , , , ,495 79, ,627 % Highly indebted poor mil $ 4,340 8,162 6,241 10,247 32,775 21,318 15, ,278 countries (PPTE) % Less advanced mil $ 3,993 6,625 7,037 9,807 23,471 17,041 10, ,168 countries (ONU) % mil $ 387, , , , , , , ,226 % mil $ 1,101, , ,317 1,237, , , , ,260 % mil $ 2,463 5,479 3,846 6,952 10,002 8,972 5, ,096 % mil $ 4,368 10,836 6,900 25,812 32,386 31,840 24, ,683 % mil $ 6,577 18,734 12,579 15,914 38,680 31,420 18, ,012 % mil $ 1,319,211 1,358, ,917 1,765,344 1,747, , , ,335,059 % Own calculation, World Bank, 2014, Indicateurs du développement dans le monde, 157

4 - In the, the share of agriculture in GDP has a national average of 1.8%, dropping from 2.1 percent in 2000 to 1.6% from 2006 until year 2012; -, in 2012, this value is of 3.1%, and the average for the reporting period is around 3.4%; - The largest shares in 2012 we can observe in the economic zones of southern Asia (18.3 %), less advanced countries (25.1%) and very poor indebted countries (26.8 %). In terms of foreign investment, period was favorable for the majority of the studied areas: - The Arab countries had growths of foreign investments from 2,640 million $ in 2000 to 69,506 million $ in 2006 and 47,202 million $ in 2012; the average for this period is situated around 44,777 million $, with an annual growth rate of 24.84%; -In East and the Pacific Asia we see significant increases, reaching in 2012 to record 414,705 million $, nine times more than in the year 2000; - Foreign investment in the countries are dropping, with an annual rate of 5.63%, 2012 recording with 53% less investments compared to the year 2000, namely 294,563 million $; Table 4. The evolution of imports of goods and services, on economic zones and globally, period %PIB % East and Pacific Asia %PIB % %PIB % %PIB % Highly indebted poor %PIB countries (PPTE) % Less advanced %PIB countries (clas ONU) % %PIB % %PIB % %PIB % %PIB % %PIB % %PIB % Imports of goods and services is an important indicator of economic development analysis, and their reporting, as share in GDP is analyzed in table no. 4, where we find the following: - In the Arabian countries, the imports have a share around 37% of GDP, with annual growth, with a growth rate of 3.36%, since the year 2000 (27.9 %) up to the year 2012 (41.5 %); - In the countries of the European Union, the imports are increasing, with a rate of increase of 1.23% for the whole period, the differences for the period and are of 4.3 %, while the average for is of 35% of GDP; - Lower values were noticed in the countries from the North America (18.2% in 2012) and (26.7% in 2012); -, the average period is 27% imports of GDP, with an annual growth rate of 1.56%. 158

5 Table 5. The evolution of exports of goods and services on economic zones and globally, period %PIB % East and Pacific Asia %PIB % %PIB % %PIB % Highly indebted poor countries %PIB (PPTE) % Less advanced countries (clas ONU) %PIB % %PIB % %PIB % %PIB % %PIB % %PIB % %PIB % The exports of goods and services as a percentage of GDP and its evolution are discussed in table 5, from where we can observe the following: - In the Arabian countries, the exports accounted for 50% of GDP (period average), with an annual growth rate of 2.69%, since the year 2000 (41%) up to the year 2012 (56.4%). - In the countries, the imports increased with a growth rate of 1.58% for the whole period, the differences for the period and are of 4.3 %, while the average for is 36 % of GDP; Table 6. The evolution of total GDP growth indices, on economic areas and at the global level, for the period 2000 to 2012 % % East and Pacific Asia % % % % % % Highly indebted poor countries (PPTE) % % Less advanced countries (clas ONU) % % % % % % % % % % % % % % As in the case of imports, lower values we see in countries in North America (14.8% in 2012) and southern Asia (22.4% in 2012);, the average period is 27% of GDP, with an annual rate of increase of 1.46%. 159

6 The growth indices of total GDP are the main indicators in the study of economic development, and their development is shown in table 6, as follows: - For the Arabian countries the total GDP growth indices have values around 5% share, we see a higher value in 2006 of 7.2%, reaching in 2012 to 6.2%; the annual growth rate is by 1.64 percent; -For the countries, indices are located at shares around 1.5%, the value in the year 2012 being negative-0.4%, the annual decrease is of % for the whole period; - Decreases of indices during the period (annual rate) is seen in North America (- 4.89%), (-2.01%), the Euro Zone (-13.34%) and at the global level (-5.08) where indices show an average of 2.7%. CONCLUSIONS The uneven development is due to diversify of the development factors; they are the ones that have helped to increase regional disparities. The pace of growth of an area will result in a maximum level of disparity between regions, then these disparities decrease. The gross domestic product has increased during the reporting period, both at the world level and for all economic areas studied, showing a positive evolution within this indicator of growth in the economy. Regarding the agriculture as part of GDP, we can notice that the largest shares are found in, also in Less-Developed Countries as well as in Very Poor Indebted Countries.A significant share of the agriculture in the GDP we can see in the Arab countries, the average for the period is of 6.7%. The foreign investment, a propulsion engine of the economy, have significant increases, as seen in East Asia while those within the are slumping. The Arabian countries know a breeder of the investment trend, with steady growths until the last year. The analysis on imports and exports as share of GDP has highlight the existing gap between the economic zones as well as the North America and South Asia, where both occupy small weights, and the Arab countries, 160 including the 's economic zone. The GDP growth indices have a downtrend for the economic developed areas such as North America and important growths in areas such as Arab countries and East Asia, Very Poor and indebted Countries. REFERENCES [1]The development and location factors of World Agriculture,visited 2014, de_dezvoltare_si_amplasare_agriculturii_mondiale html?in=all&s=mpie [2]The GDP at regional level,,2014, [3]The gross domestic product, [4]The measuring indicators of results at the macroeconomic level, course Stud.CSIE.seriile SCN, C + D, XI, 19-20, 2008, [5]The World Bank Data, accessed sept 2014, D.ZG [6]Typology of world states,